Supply Partner Compliance Guide Delivering a response to DFID’s Code of Conduct V3 - 2019

1. Supply Partner Compliance GuideDelivering a response to DFID’s Code of ConductV3 - 2019

2. Supply Partner Compliance Guide - Contents • What’s in the Code? • Collaborative Approach • Compliance Levels • Compliance Timeline • Supplier Response • Spot Check • Deep Dive • Delivery Chain Partners • Non-Compliance • Response Template • Supporting Documents

3. The Supply Partner Code of Conduct gives DFID a mechanism to ensure supply partners are providing value for money and behaving ethically throughout their supply chains. The Supply Partner Code of Conduct resulted in revisions to: • Terms and Conditions of Contract which now includes the Code of Conduct in all DfID contracts and amendments • We are working towards including the Code of Conduct in DfID’s Accountable Grants Once this is in place organisations with multiple arrangements (Accountable Grants / Contracts) will be required to provide one submission based on contractual obligations only which will in turn apply to any accountable grants. Supply Partner Code of Conduct - What’s in it? The Code of Conduct requires supply partners to follow these overarching principles: • Act responsibly and with integrity • Seek to improve value for money • Be transparent and accountable • Demonstrate commitment to poverty reduction and DFID priorities • Demonstrate commitment to wider HMG priorities It sets out specific requirements in six areas: • Value for money and governance • Ethical behaviour • Transparency and delivery chain management • Environmental issues • Terrorism and security • Safeguarding, social responsibility and human rights Compliance will be monitored against supplier level and contract specific KPIs A central Compliance & Risk team is in place to consistently manage ongoing compliance and risk across our Supply Partner arrangements

4. Supporting you to Comply– Collaborative Approach What value does compliance add? The introduction of the Supply Partner Code of Conduct is about improving standards throughout not only our delivery chains, but more widely throughout the Aid sector. Organisations seeking work in the aid sector will have many of our expectations in place and appreciate the need for integrity with public money. Your Compliance Score Supply Partners engaging with the Code for the first time on average score around 76% on their Corporate Spot Check. We are here to help you reach 100% by sharing a detailed Compliance Plan. A Dedicated Compliance Team We have a dedicated Compliance & Risk team to help you comply with the Code. As a strategic Supply Partner you will be allocated a dedicated Compliance Manager and you can contact our mailbox Suppliercompliance@dfid.gov.ukat any time. Demonstrating Compliance 100% Corporate Spot Check Score can be achieved via one comprehensive response per annum. Doing so will reduce your response requirements throughout the year as we will only need to collect specific contract data or for Deep Dives thereafter. Reaching 100% isn’t as difficult as you think! During onboarding we will meet to discuss your score for each area of the Code and break down what the next steps are. Typically it requires 9 actions to be completed to reach a 100% Corporate Spot Check Score 7 “It’s difficult and costly to demonstrate compliance” Where reasonable, we want to work with you to achieve compliance where you may not previously have been able to demonstrate the standards set out within our Code. We will work collaboratively to check not only your policies and procedures via ‘Spot Checks’, but the practical application of them via ‘Deep Dives’ – This helps to focus your resource on key areas

5. Compliance Levels – Making compliance proportionate How do we ensure compliance accounts for a varying size of supply partners? There are three levels of compliance with the Code. Lower levels were developed after consultation to ensure the Code does not act as a barrier to smaller supply partners working with DFID whether directly or in a supply chain What is required for your delivery chains? Each tier of the delivery chain is required to report assurance on the tier below based on the applicable Compliance Levels.

6. Compliance Timeline – For supply partners new to the Code Supply Partner signs Contract arrangement, which includes the Supply Partner Code of Conduct. A signed Supply Partner Compliance Declaration (Appendix 1b) to adhere to each KPI is returned as part of the signed arrangement and a copy passed to the Compliance Team. Compliance Team conducts spot checkon supply partner response and shares results with actions to remedy any outstanding points. Compliance Team will also share a Compliance Plan at this stage with relevant DFID Programme Team/supplier as necessary. Compliance Team conducts themed Deep Dive assessments of suppliers and the specific funding arrangements linked to the Code. Supply Partner must provide an initial response to the Code of Conduct at a corporate level. This can involve submitting a completed ResponseTemplate to the Compliance Team. Compliance Team may share compliance related lessons learned throughout the contract lifecycle with the Supply Partner and DFID Programme Teams. Compliance Team conducts scheduled Spot Checks on supply partners, ensuring that documents are up to date - this can be used to trigger a Deep Dive at any point. Funding Arrangement Starts End to End Lifecycle Award Stage Funding Arrangement Ends Compliance Baseline is formed Compliance Delivery is monitored Supplier Action Compliance Action

7. Supply Partner Response in Detail – What do you need to provide? • Tendering Stage • Supply Partners will submit a ‘Yes’ response, agreeing to sign up to DFID’s T&C’s (which includes the Supply Partner Code of Conduct) as part of their Supplier Questionnaire response, as part of the tendering process. Specific policies that are considered to be material to a contract may also be requested as part of the tender submission. • Contract Award Stage • Supply Partner will submit a signed Supply Partner Compliance Declaration as part of their contract acceptance. • Contract Commencement • Supply Partner (where applicable, i.e. if a new DfID Supply Partner) ) willprovide a corporate level response to the DFID Code of Conduct within the first two months of contract commencement. Supply Partners can make use of the Supply Partner Response Template to display compliance with each KPI in the Code. Responses should include copies of all applicable documentation - these are detailed for reference in the Supply Partner Policy & Document Checklist, available on slide 13 of this pack. • Existing ‘Code Compliant’ DfID Supply Partners need only submit a contract specific response. • The Supply Partner Response Template allows Supply Partners to: • Provide a RAG rating for each KPI and an expected compliance date for any KPI where full compliance cannot yet be demonstrated • Demonstrate compliance at a Corporate & Programme (contract) level for each KPI • Detail points for discussion with DFID, next steps to achieve full compliance, and reference documents relating to each KPI

8. ‘Spot Checks’ – What to expect? Activity The Compliance Team will conduct Spot Checks on Supply Partners: At the start of a newly signed / amended contract by assessing the Supply Partner’s initial response on the Code of Conduct. Annually throughout the contract lifecycle to ensure declarations, documents, memberships, processes, etc held are up to date. Spot Checks will assess documentation provided at a corporate level and one comprehensive response will apply across multiple contracts. Your organisation will receive a corporate spot check score which will be held to apply fully across your DFID contract portfolio. Contract level data needs to be provided for particular KPIs on each individual contract: e.g. profit % on contract, delivery chain map, etc. Results The Compliance Team will share results of Spot Check activity with the Supply Partner and appropriate programme teams within DfID. This will include clear actions to remedy any missing documentation or non-compliance and we will liaise with supply partners to agree the timescales requirements for reaching 100%.compliance

9. ‘Deep Dives’ – What to expect? Activity The Compliance Team will conduct Deep Dives on Supply Partners: As triggered by questions raised during Spot Checks As triggered by Programme Teams At checkpoints throughout the contract lifecycle. These checks will be on a particular thematic area from the Code (e.g. Value for Money) and will involve in-depth checking of Supply Partner activity and documentation submitted during the Spot Check phase. Supply Partners may be asked to provide additional documentation relative to a particular contract in order to satisfy checks. Documents held from the Supply Partner’s initial submission will be accessed for these checks to avoid replication of efforts. Results The Compliance Team will share Deep Dive results with the Supply Partner and appropriate teams within DFID via comprehensive reporting. This will involve setting clear actions to remedy any non-compliance and agreement of timescales to rectify & improve standards where necessary.

10. Delivery Chain Partners – What do you need to provide? Direct Supply Partners are expected to provide information on their Delivery Chain Partners and ensure that they adhere to the Code of Conduct at the applicable Compliance Level. Direct Supply Partners should demonstrate their Delivery Chain Partners’ compliance to the Code of Conduct by supporting Deep Dive activity conducted by the Compliance Team. A Delivery Chain Map, that clearly demonstrates fund distribution throughout the delivery chain on a programme, will be central to enabling these checks. Delivery chain maps will be accessed from the Contract submittal materials.

11. Non Compliance – What next? Supply Partners are required to be open and transparent about their compliance with the Code of Conduct. Where there is non-compliance the Supply Partner must work with DFID to improve the area identified. In the event of non-compliance, the Compliance Team will follow the procedures set out in Clause 39 of the contract T&Cs, potentially involving a rectification plan being required from the Supply Partner to bring them in line with the Code of Conduct. Both parties will also agree timescales suitable to work towards becoming fully compliant. In the event of continued non-compliance after discussions with the Compliance Team, or failure to adhere to a rectification plan, DFID will take appropriate action in line with Clauses 40, and 43-45 as set out within the contract T&Cs. These contractual processes may also be followed if findings from Deep Dive activity are unacceptable.

12. Response Template – How to Populate This area details the KPI number, priority area and the contractual KPI from the Code. This box provides brief guidance on what we expect you to provide as a minimum – please note that this is not exhaustive to our checks. Please RAG rate your organisation against this KPI and mark as “Complete” if fully compliant or replace complete with the expected compliance date. Format: DD/MM/YYYY Populate this box with any points of discussion you have on this particular KPI or alternatively populate with N/A. Populate this box with commentary around how your organisation adheres to the Code KPI. This should include commentary as to what your organisation does in this area, referencing attached policy, procedure, declarations, etc. Populate this box with next steps you are taking to achieve full compliance to this KPI if applicable or alternatively populate with N/A. Key Please reference your attached documents in this box. This ensures that we can check the correct files which correspond to each KPI. (Not for file embedding) E.g. 1 – Finance Governance Policy.pdf = No Action Required = Populate

13. Supporting Documents Please refer to the following documents to further aid your compliance submissions: 1) Supply Partner Code of Conduct (Includes Declaration) You can find these documents on our website. https://www.gov.uk/government/organisations/department-for-international-development/about/procurement 2) Supply Partner Compliance - Response Template 3) Supply Partner Compliance – Policy & Document Checklist 4) Supply Partner Compliance – Supplier Handbook